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SBI Japannext breaches record in Abenomics shake-up

Japanese proprietary trading system SBI Japannext hit a new daily trading record as the country's markets surged on news of a government plan to eradicate deflation.

By Richard Henderson richard.henderson@information-partners.com April 05, 2013 1:35 PM GMT

Japanese proprietary trading system (PTS) SBI Japannext hit a new daily trading record as the country's markets surged on news of a government plan to eradicate deflation.

The country's largest PTS by value traded set a new daily turnover record of US$1.48 billion (¥139.2 billion), surpassing its previous record of US$1.29 billion, and nearly a 50% increase on the billion dollar daily trading milestone it achieved for the first time on 19 December, with US$1.07 billion traded, according to its own figures.

Japanese stocks surged on yesterday's announcement that the Bank of Japan would pursue an aggressive quantitative easing strategy to double the monetary base of the country within two years through open-ended asset purchases.

The Bank said it aimed to extend the country's monetary base to ¥270 trillion (US$2.8 trillion) from the current figure of ¥135 trillion (US$1.4 trillion), alongside a government stimulus plan totalling US$107 billion. The plan has already had a marked effect on Japanese markets, driven by newly elected prime minister Shinzo Abe, who returned to office since in December 2012 having resigned in 2007.

Although reaching a new value traded milestone for the month of March, the PTS did not climb significantly in terms of market share of Japanese equities.

In March, SBI Japannext accumulated 3.13% of Japanese equities trading, with US$18.3 billion traded, up from 3% in February, according to data from Thomson Reuters Equity Market Share Reporter. Competing PTS Chi-X Japan also gained market share, taking 2.18% of market share in March with US$12.8 billion, up from 2.06% in February.

Market share gains in March were stronger for the Osaka Securities Exchange (OSE), which is part of the Japan Exchange alongside the Tokyo Stock Exchange. The OSE jumped to 5.38% of market share with US$31.6 traded, from 4.39% in February.

Overall, value traded figures for Japanese stocks have skyrocketed since pre-election indications that Abe would be elected in November. Total equity trading figures for March show US$587.96 billion traded, an 80.8% increase on November's figure of US$325.02 billion, according to data from Thomson Reuters.